Do International Students See Australian University Tuition Fees as Good Value for Money?

26 Oct Do International Students See Australian University Tuition Fees as Good Value for Money?

According to QS Top Universities, the average undergraduate international student to Australia now pays around A$29,235 per year in tuition fees, while a postgraduate student can pay between A$20,000 to A$37,000 per year.

With perceptions of value playing such an important role in the decision-making process, as consistently shown in our annual International Student Survey (affordable fees are the second-most important factor for international students when choosing a course), we wanted to explore how favourably international students perceive Australian tuition fees, how Australia compares against other major study destinations, and how value for money perceptions change after commencement.

Between 21 September and 12 October 2017, QS Enrolment Solutions (formerly Hobsons Solutions) heard from 1,351 prospective (919) or current (432) international students to Australia in response to an online survey.

The key findings of our analysis are:

Overall, prospective and current international students coming to Australia see tuition fees charged by Australian universities as offering good value, but Australia is behind Germany and Canada in perceptions of value

Australia is seen as offering better value for money than New Zealand, the USA and the UK

There is a significant gap in perceptions of value between prospective and current international students in Australia, with current students far more likely to view their tuition fees as offering poor value for money

Anecdotally, current international students are well aware that they pay much higher fees than domestic students, and this is a key source of frustration

Postgraduate international students generally see Australia as better value for money than undergraduates.

International students generally see tuition fees charged by Australian universities as offering good value for money
58% of international students considering or studying in Australia say tuition fees in the country are good or very good value for money. Just 19% say Australian tuition fees are poor or very poor value for money, giving Australia a net score of +39.

This places Australia in the middle of the pack when compared to key competitor markets.

Since the results shown here are collected from students considering or already studying in Australia, the comparisons with other destinations in the chart below show us the perceptions of this specific group, rather than all international students globally.

These prospects and students are already inclined to view Australia in a positive light. For example, when we compare the results of the survey to those from international students considering the UK, Australia’s net positive rating is lower, at +30, which is below the UK in that market.

Germany and Canada are perceived as offering good or better value for money, and therefore pose a challenge to Australian international student recruitment
In this context, Germany, with a net value for money score of +48, is a strong competitor to Australia in the international student recruitment market. Canada, with a net score of +46, also scores well in net favourability, with the added advantage of being an English-speaking country.

Current students are much more likely to view Australian university tuition fees as offering poor value for money
The good news is that prospective international students overwhelmingly believe that Australian university tuition fees offer good value for money, with a net +57 rating.

The less positive news for Australian universities is that students who have commenced their studies in Australia view value for money as a net negative (-2), showing a clear disconnect between expectations and experience.

We’re not suggesting this is cause for panic. We acknowledge that this type of survey is likely to attract comments from students with grievances to air, and that the students surveyed are likely to have commenced only recently – their experience is not the full picture.

Realistically, value for money assessments should be made after graduation, when the student has been through the full university experience and had the chance to test their degree’s value against their career or lifelong learning goals. Outcomes matter enormously to perceptions of value, and there are many thousands of happy international students graduating from Australian universities every year, after all.

Nevertheless, we think such a significant shift in perceptions is worth investigating.

Why is there such a gap between perceptions of value for money between prospective and current international students? This survey shows a similar pattern for respondents considering or studying in the UK or New Zealand, with current students less likely to say their tuition fees are good value than prospective students. The effect is much stronger for Australia, though.

Cost of living factors and additional costs are influential here. Many respondents cited high costs of rental accommodation, food, transport and bills, despite being asked specifically about tuition fees. These extra costs add to the financial stress felt by international students, and colour their attitudes.

Another possible reason is the shift in what their tuition fees are being compared against. As prospective students they compared international student fees between other potential destination countries and universities.

After commencement, they begin to compare what they pay with what their local classmates pay, and the comparison isn’t favourable.

International students resent being charged much more than domestic students
Anecdotal feedback collected from current international students focused on the differential between domestic student fees and international student fees. Surprisingly, this was true even for many students who said their tuition fees represented good value for money.

While issues of teaching quality, student support and additional costs (for administrative fees, books, and overall cost of living. etc.) were also raised, the high cost of international tuition fees compared to domestic students was mentioned by most respondents:

“It is too expensive compared to what domestic students pay, the technology and infrastructure in place is not very high standard. In addition, the class rooms are not tech savvy.” – Female, 26-30, postgraduate student from Nigeria. “As an international student, I think tuition fee is very high in Australia. In one hand we are struggling for our daily expenses and in the other hand we are working very hard to manage tuition fees.” – Male, 20-21, undergraduate student from Nepal.

“I don’t think the tuition fees for student should be this high. The fees are almost zero for domestic students but the fees for international students is like sky-high.” – Female, 31-35, postgraduate student from Bangladesh. “The international student fee is almost 5-fold compared to the domestic student fee. Given that we share the same facilities, it is somewhat unreasonable to me to charge the international student such a high value of tuition fee.” – Female, 18-19, undergraduate student from Hong Kong.

QS Enrolment Solutions views this as a warning sign for policy-makers and universities considering international student fees as a means of offsetting proposed federal government funding cuts to higher education. Unfortunately, many international students in Australian universities already feel like they are being treated unfairly.

In our view, further increases to international student fees should be treated cautiously.

Future students’ expectations of how much they will pay don’t align well with average tuition fees
More than half (57%) of the international students considering or studying in Australia expect to pay less than A$20,000 per year in tuition fees, significantly below the average fees for undergraduate and postgraduate degrees. This underlines the importance of scholarships to prospective international students, and highlights another possible cause of the sticker shock affecting current students.

Postgraduate international students generally see Australia as better value for money than undergraduates
Comparing the results by level of study shows that postgraduate international students had a more favourable view of the value of Australian tuition fees (+45) than undergraduate international students (+29).

This is likely associated with the career-focused degrees most popular with postgraduate international students coming to Australia: they are more likely to have a clear career goal in mind and calculating return on investment is more straightforward for this cohort.

International students would pay more to be taught by the best qualified staff, and with the best graduate outcomes
What would international students considering Australia consider to be the best way to add value for money? It really does boil down to teaching quality and graduate outcomes.

28% of surveyed prospective and current international students said when choosing between universities, they would pay “a lot more” to study at a university with a high percentage of graduates in employment within 6 months of graduating, with 39% saying they would pay “a little more”.

26% of surveyed students said they would pay “a lot more” to be taught by better qualified teaching staff than at other universities, with a further 44% saying they would pay a little more for this.

International students also said they would pay more to choose a university with more face-to-face teaching hours, higher rankings, and with better facilities (including libraries and sports facilities) than other universities.

Survey information
QS Enrolment Solutions (formerly Hobsons Solutions) conducted an online survey of international students considering or already studying in three major study destinations: the UK, Australia and New Zealand. The survey was conducted between 21 September and 12 October 2017 and 2,731 qualifying responses were received across all destinations – a response rate of 9.2%. 1,351 respondents were either interested in or currently studying in Australia.